Andy Patrick|Effective Representation for Hilton Head Island

Recently the South Carolina House of Representatives passed legislation introduced by members of the Beaufort County Delegation that would allow municipalities within Beaufort County to levy an extra penny of sales tax.  Fundamentally, from a fiscal conservative perspective I am opposed to increasing taxes.  However, let me share some facts regarding this particular piece of legislation.

This initiative as drafted, is designed to help our community compete with other destination locations    from a marketing perspective.  Currently we spend the least amount of money of all the destinations we compete with.

The current Accommodations Tax collected on Hilton Head Island and sent to Columbia accounts for $11.7 million.  In accordance with state law we receive 10% ($1.2 million) back.  SOUND FAMILIAR!  The next highest percentage of return in our competition set is that of San Antonio, TX at 22%.  San Antonio spends $11.1 million to market their destination.  Virginia Beach receives 100% of their Accommodations Tax back for marketing ($11.1 million).

The economic impact of tourism on our local community cannot be overlooked and/or ignored.  Tourism accounts for more than a billion dollars and is the engine driving our local economy.  The revenue generated through tourism helps to provide the funding for our beaches, parks, cultural assets and other elements related to our “quality of life”.

30% of the revenue will go directly to property tax relief for island homeowners (both primary and secondary residential properties). 67% of the cost of the one cent will be covered by the nearly 2 million annual visitors. 20% will go toward capital improvement projects such as beach re-nourishment.

The one cent will not be levied against groceries, gasoline or prescription medication.

This legislation provides local government another tool for the tool box.  By its very sum and substance this approach is centered within the “Home Rule” concept.  Allowing government closest to the people to govern most effectively.

Because our gated communities are built out we do not have developers marketing our destination for us, as a result that burden falls upon us to determine how we re-build this community for our future.  Hilton Head Island was at one time a world-class destination.  In order for it to become that once again we need to be creative, think “outside the box” and make some difficult decisions during difficult times.

We need to comprehensively reform our tax system so that we do not tax productivity and capital.  Instead of Income and property taxes, we should attempt to generate revenue from taxing consumption (sales) as it is less restraining on growth (FAIR TAX).